I work contract (1099) meaning I don't have any money deducted from my paycheck, and when I file, I pay.. and pay.. and pay.
So this idea just raises a train of questions for me.
When did my unpaid taxes (as they accrue through a fiscal year) become a line of credit from the government?
Will such things show up on my credit report if I don't file on time?
Can they (like a credit card company) "cancel" my account and stop extending me credit? How would that work?
This makes for some interesting scenarios (at the cost of your credit rating) where the IRS may not accept an Offer In Compromise (basically you offer $0.80 or less, sometimes down to $0.10 on the dollar) currently because they think you'll have no problem paying the full amount -- but debt collectors always accept such offers since they keep something like 60-80% of what they recover as their "fee" and pay the rest to the creditor.
If that's the case.. tax paid would no longer equal (or even approach) tax collected.
Imagine if 60 cents on every dollar you paid went to a for-profit debt collection agency rather than the government.
There's definitely a lot to think about here.. heh.